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How much would you need to invest to get a return of $1.00 from an investment wi

ID: 2708172 • Letter: H

Question

How much would you need to invest to get a return of $1.00 from an investment with a price per share of $36 with earnings per share of $1.80?

Answer

$1.00

$1.80

$20

$35.20

$180.00
  
  
  

Buying shares of foreign stock   generally

Answer

is not as risky as buying common     stock.

is riskier than buying shares of     domestic stock.

has higher transaction costs     than preferred stock.

a. and b.

a., b., and c.

The risk that your foreign investment   will lose value because of the actions, inactions, or instability of the   foreign government is called

Answer

regulatory risk.

political risk.

economic risk.

currency risk.

market risk.



  

$1.00

  

  

$1.80

  

  

$20

  

  

$35.20

  

  

$180.00
  
  
  

  

Buying shares of foreign stock   generally

  

Answer

  

    

is not as risky as buying common     stock.

    

    

is riskier than buying shares of     domestic stock.

    

    

has higher transaction costs     than preferred stock.

    

    

a. and b.

    

    

a., b., and c.

       

  

The risk that your foreign investment   will lose value because of the actions, inactions, or instability of the   foreign government is called

  

Answer

  

    

regulatory risk.

    

    

political risk.

    

    

economic risk.

    

    

currency risk.

    

    

market risk.

       

Explanation / Answer

Question 1: For $1.8 of earnings we have to buy a share for $36 then for $1 of earning the share price is

$1.8 ------> $36

$1 -------> ?       => $36/1.8 = $20

Hence, Option C is correct

Question Number 2  

has higher transaction costs than preferred stock

Question 3 :

political risk.

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